Sort & Cull

Bright and early Monday morning, the feeder cattle complex appeared to be off to a good start as the contracts were trading higher and, fundamentally, the market remained in a strong position. But it wasn't long before the market began to become skeptical and lower prices overcame the entire feeder cattle complex. By Monday's close, the market had dropped anywhere from $2 to $3 lower, as traders attempted to manage the market's technical resistance and some profit-taking, which is most likely why the day's trade ended on a sharply lower note.

Last week, the January feeder cattle contract rallied $5.18 throughout the week, and the March feeder cattle contract rallied $5.50 throughout the week. But by Friday's end, the spot January contract was nearing $260, which remains the market's long-term resistance threshold and hasn't been traded above since early July. And, although feeder cattle demand in the countryside remains incredible and cattle imports from Mexico aren't expected to resume ahead of the New Year, traders elected to capitalize on the market's short-term rally while the opportunity presented itself.

The market resistance at $260 is substantial, but so is the cattle market's rally and power right now. If all the stars continue to align -- strong packer support in the fed cash market, strong boxed beef demand, and the willingness of traders remains ample -- the resistance at $260 isn't unbearable. But, like all good things, whether the market possesses enough power to overcome that resistance will only be told through time.

I want to personally welcome you to join us later this week for the DTN Virtual Ag Summit event. I will present a 2025 cattle market outlook on Dec. 6, and you can ask questions at the end of the presentation. It's been another incredible year for the cattle complex, and while I'm thankful that producers have been able to capitalize on these historical prices, that doesn't mean that the year behind us hasn't presented its own challenges, or that the upcoming year will be without challenges.

The DTN Ag Summit is scheduled for Dec. 5-6, 2024. Use this link to find out more and to register for the free event: https://dtn.link/….

You can also see more about the upcoming Summit in these Reporter's Notebook videos: https://www.dtnpf.com/… and https://www.dtnpf.com/….

ShayLe Stewart can be reached at shayle.stewart@dtn.com

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